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Amazon facility in Otay Mesa eyes summer completion

The retail giant’s new distribution facility bringing jobs and spotlight on Otay Mesa

By PHILLIP MOLNAR | The San Diego Union Tribune

Amazon’s massive distribution center in Otay Mesa could be completed by this summer and provide up to 1,500 jobs.

The Seattle-based retail giant has been constructing the 3.4 million-square-foot facility on Otay Mesa Road for more than a year. It will be one of the largest buildings ever constructed in San Diego County and part of the rapid industrialization of Otay Mesa.

Amazon has yet to confirm or mention the facility. However, real estate tracker CoStar has verified the retailer is the owner through grant deeds and other research. There is also an Amazon shipping container, with a large image of the company’s logo, used as an office at the job site.

County officials, and CoStar, estimate the distribution center will open sometime in June. Roughly 1,500 jobs will be created at the facility, according to a market study for San Diego County by Meyers Research.

Amazon did not respond to comments, nor did the Atlanta-based company constructing the facility, Seefried Industrial Properties. According to its website, Seefried has built facilities for Amazon in Wisconsin, Illinois and other places across the nation.

Public records say Amazon paid $29.7 million for the 65-acre site in March. This week, hundreds of workers could be seen constructing the northern half of the building, while traffic snarled around it as cars were pushed to one lane to make way for road improvements. The project site, farther away from most of Otay Mesa’s office space, almost looks like a small city that has popped up near rolling green hills.

For promoters of the region, the Amazon facility is another sign that Otay Mesa’s time has come. Alejandra Mier y Teran, executive director of the Otay Mesa Chamber of Commerce, said the region has benefited from increased manufacturing production in Baja California, being one of the last places for industrial land in San Diego County and, now, the massive growth of online retailers needing storage.

“It is exciting to see all the development and jobs being created,” she said. “Our companies are actually hiring. We are excited to contribute to San Diego’s economy when it is needed the most.”

Donna Durckel, spokeswoman for San Diego County’s Land Use and Environment Group, said the site was previously vacant. She said 43,371 square feet of the site will be for office space, with the remaining 3,387,858 square feet for the warehouse.

The Amazon facility is slightly outside the city of San Diego on unincorporated county land — about one mile northeast of the Otay Mesa Port of Entry. Much of the built-up in Otay Mesa has been the result of new trade deals that give American and Canadian businesses tax benefits for outsourcing to Mexico instead of Asia. However, a second phenomenon in Otay Mesa is it is the least expensive spot for industrial land and has attracted companies that aren’t focused on the border.

Otay Mesa industrial land in the last 12 months has sold for an average $176 per square foot, said CoStar. That is compared to $300 per square foot in Sorrento Mesa and $253 per square foot in Carlsbad — both areas known for attracting biotech businesses.

San Diego Councilwoman Vivian Moreno, whose district includes Otay Mesa, said the area is often forgotten by many people in the county but shouldn’t because it will become an economic engine. While the Amazon facility is slightly outside San Diego, Moreno noted that the city has made investments to improve Otay Mesa, which have likely made doing business there more favorable to companies.

One thing she cites is a $22.7 million state grant the city was awarded in December to widen and improve La Media Road — aimed at reducing truck congestion on the busy road by the border.

“I think what these companies want to see is a first-class road, a first-class city and a first-class experience,” Moreno said. “That’s where we come in as city representatives and say we need to build these roads. All these infrastructure improvements are not really about today. It’s about what’s going to happen in 20 to 40 years.”

The new jobs at the warehouse come on the heels of San Diego County losing roughly 105,600 jobs in a year as of December. Moreno said that shouldn’t take away from the new positions being created at the warehouse.

“Those are 1,500 families that we are impacting,” she said. “I think one job is tremendous. When you talk about 1,500, that changes people’s lives.”

On a national recruiting website, Amazon said workers at its facilities get a starting wage of at least $15 an hour and health benefits start on the first day. That hasn’t stopped a union drive at many facilities with organizers seeking higher wages and increased safety protocols in the warehouse. A union vote started this week at a warehouse in Bessemer, Alabama, which could become the first Amazon union in the United States. That facility, with roughly 5,000 workers, is bigger than the Otay Mesa warehouse.

Amazon’s warehouse is at the corner of Otay Mesa Road and Enrico Fermi Drive, directly at the entrance of State Route 11. Drivers will be able to rapidly connect to the State Route 125 toll highway or State Route 905.

The facility will benefit from improvements in the area, which have included the conversion of California State Route 905 into a freeway and a $137.2 million ongoing remodel of the border crossing.

There have been several large deals made in Otay Mesa in recent months. Two Southern California companies, Majestic Realty Co. and Sunroad Enterprises, began construction in January on a $100 million, 50-acre industrial park. Another one of Otay Mesa’s large industrial buildings, the 601,417-square-foot 2020 Piper Ranch Road building, sold to Denver-based Black Creek Group in December for $109 million.

Similar to Otay Mesa, the Mexican side of the border has also seen growth thanks to changes from the new United States-Mexico-Canada Agreement, nicknamed “NAFTA 2.0,” which encourages production closer to home. Santa Cruz-based headset manufacturer Poly recently moved production from China to Tijuana, investing $3.2 million and creating 1,450 jobs — nearly the same amount as Amazon on the U.S. side of the border.

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